At a time where there is no shortage of problems with the national and local economy and, by extension, no shortage of ideas on how to fix them, it comes as no surprise that not everyone with a remedy is heard.
Of course, there is the boisterous voice of the mass hodgepodge that is the Occupy movement, but they can’t seem to agree on a central idea other than that they’re unhappy. While its voice is louder than that of the average Tea Partier, it still comes down to a drum circle being louder than a suburbanite in a lawn chair.
Enter David Krikorian: The two-time candidate for Ohio’s 2nd Congressional district has formulated a nonpartisan proposal to not just talk about what’s wrong but also to start doing what he believes is needed to help repair the financial system. A proposal that, Krikorian says, would “be part of a plan to restructure Ohio’s economy.”
On Krikorian’s Right/Left Wrong, an online forum that “fosters outside the box thinking from the radical middle,” Krikorian has proposed the state adopt a public banking system in the form of the Public Bank of Ohio (PBO). According to the website, the PBO would “alleviate the squeeze on credit, greasing the gears of capitalism for small business, the engine of economic growth.”
Krikorian highlights the Bank of North Dakota, which was founded in 1931 and reportedly raked in over $300 million during the last decade, as an exemplary model for Ohio to study.
“When we look at our society today, we see many similarities to what the business leaders at that time were dealing with,” Krikorian told CityBeat. “We had both progressive Democrats and progressive Republicans looking for a way to fight the push and pull between Wall Street and Big Banks, and even now public banking is something that forward thinking individuals are looking at.”
A Public Bank of Ohio would alleviate the strain the financial crisis in Europe puts on the local economy, he adds.
For example, in Greece where wild spending and lenient financial reforms has led to a $4 billion national debt, the Euro has been crippled and U.S. investors could soon feel the crunch as well. Fitch Ratings has reported that 10 of the largest U.S. prime money funds have around half of their assets stored in European banks, which means those banks could soon become jeopardized as the contagious European financial crisis reaches its hand across the pond.
“One of the positives of the Public Bank of Ohio is that it would help buffer the European financial crisis and help foster credit unions,” Krikorian says. “The Public Bank would not compete with other banks. It would serve existing Ohio banks — especially community banks and credit unions — with access to lower cost funds and a shared services model for regulatory compliance costs which, generally speaking, amount to a regressive tax on smaller banks.”
Krikorian maintains the PBO is a step in the right direction for the state and would do more than just help cushion the blow of Europe’s financial mess.
“We have not passed a single reform of the financial state,” he says. “Sure, we’ve passed things called reforms. We’ve moved the Jell-O around the plate a little. But nothing’s changed. You’d see existing banks expand and, in turn, create more jobs. The Public Bank of Ohio itself would create hundreds of jobs as it began full-scale operation.”
Although public banking in Ohio sounds lucrative, Krikorian says there’s no real timeline for implementing the concept at the moment. “How long is it going to take? It’s a question of function of how bad is it going to get.”
Krikorian says he’s working with State Reps. Peter Stautberg (R-Anderson Township) and Connie Pillich (D-Montgomery), along with Robert Palmer, president and CEO of the Community Bankers Association of Ohio, to organize informational meetings to educate people on the concept of public banking.
Pillich says she has received literature on public banking systems but that’s as far as it’s gone, while Palmer is looking to meet with his board to discuss idea.
“(We’re) just starting to do research on the viability of an entity like that,” Palmer says. “Obviously, it’s something new, creative and interesting but I want to talk to my board about it more later this week. They may have knowledge of something else out there like that.”
Krikorian has hopes to bring Bank of North Dakota CEO Rick Clayburgh to the forefront of the push for public banking in Ohio for informational meetings but the two are still in talks.
“I don’t want to talk about the legislative aspect of it yet,” Krikorian says. “Just getting people access to really good information about the people living and breathing under this. In a state that’s struggling financially as much as we are, this is a way to have the system work more for us. No one should be against looking at it.”